How much does electric car insurance cost?

More electric vehicles are hitting the road. EV sales are expected to rise from 6.6 million in 2021 to 20.6 million in 2025, according to BloombergNEF’s “Electric Vehicle Outlook 2022” report. But some people have questions about the cost of electric vehicles, including the cost of insurance.

How much does it cost to insure an electric vehicle, which EV model is cheapest to insure and which insurance provider offers the cheapest rates?

Read on for everything everything you need to know about insuring an electric vehicle.

How much does it cost to insure an electric car?

The average cost to insure an electric vehicle is $2,322, according to an analysis by Insurance.com.

But rates vary depending on many factors, including the vehicle’s make and model.

The most expensive electric car to insure is the Audi RS e-tron GT. You'll pay an annual premium, on average, of $4,150 a year. The Tesla Model S Plaid is right behind it, however, averaging $4,115. The third most expensive electric vehicle to insure is the Porsche Taycan Turbo S. You'll pay a pretty penny to insure that as well: $4,028.

Naturally, you're now wondering what the cheapest EV car is to insure. That would be the Mini Cooper SE, which would generally cost you around $1,479 a year for coverage.

Where can you buy electric car insurance?

Virtually every car insurer offers electric vehicle policies, but some of the providers that are particularly well known for insuring EVs are State Farm, Geico, Progressive, Nationwide, Farmers, Allstate and AmTrust Financial.

Each insurance company uses its own formula to set rates, so the quote you see from one carrier to the next can vary by thousands of dollars. That’s why it’s so important to shop around.

When it comes to electric cars, State Farm has the cheapest insurance, according to a 2022 analysis by Insurance.com. On average, an annual premium for an electric vehicle insured with State Farm will run you $1,624 a year.

Geico is a close second. Its premiums for an EV typically cost $2,041 a year. On the other hand, AmTrust Financial tends to be the most expensive at $3,650.

Keep in mind, the figures in the above table are just numbers Insurance.com has crunched from reams of data. If you end up insuring an electric car from, say, State Farm, your rate may be far different.

Does Tesla offer electric car insurance?

Tesla, the EV car manufacturer, started offering insurance coverage in 2019. Tesla’s insurance is underwritten by State National Insurance and is currently only available to drivers in Arizona, California, Illinois, Ohio, and Texas, according to an April 8, 2022, Insurance.com report. However, it’s said the company has plans to expand into other states.

Interestingly, Breeze Insurance, an insurtech company, in early 2022 released a survey that found 66% of car owners are interested in getting auto insurance from an auto manufacturer, such as Tesla, instead of from a traditional carrier.

Tesla makes the case that electric vehicles are so costly and specialized that they can do a better job insuring their own cars than other insurance companies. The only way to really determine that, however, is to comparison shop and see if they can beat other insurers.

Electric vehicles insurance vs. conventional vehicle insurance

Coverage for electric vehicles may cost more than insurance for a conventional car, according to Progressive. An electric vehicle doesn’t have as many parts as a gas-powered vehicle, but those parts are more expensive, which can increase repair and replacement costs.

However, car insurance for an electric car works just like the insurance you get for a conventional vehicle. Liability, collision, comprehensive and other coverage options are all available, according to Allstate.

Does it cost more to insure an electric vehicle?

An electric car's higher price tag and more complex equipment mean it may cost more to repair or replace than a gas-powered auto if it's in an accident. That can mean higher rates for policyholders who carry comprehensive and collision coverage.

The average price of an electric vehicle is right around $56,000. If you bought your last gasoline-fueled car for, say, $30,000, of course, you're going to spend more on insurance for a car that sets you back $56,000.

However, tax incentives and long-term savings on fuel and maintenance can help offset higher insurance rates.

Why are electric cars expensive to insure?

Electric cars are more expensive to insure because they have a higher purchase price and use new technology that's costly to repair or replace. EVs are newer to the market and tend to be more challenging -- and thus more expensive – for mechanics to work on, according to Paul Scalone, a licensed Insurance agent who works for Allstate in San Diego, California.

In other words, you have to hire specialized mechanics to fix an electric car, which means you're going to pay more in repairs, which also factors into the insurance premiums.

And Scalone points out that there are a number of other factors that go into pricing, having nothing to do with whether your car is charged at an outlet or filled up at the gas pump, such as how many miles you drive per year, the ZIP Code in which you live and your driving history.

How to save on electric car insurance

The best way to save on insurance for an EV, or any vehicle for that matter, is to shop around on Insurance.com or another insurance comparison site.

In addition to comparison shopping, Insurance.com offers the following savings tips.

• Raise your deductible, which can decrease your premium costs significantly.
• If you purchase two or more types of insurance from the same carrier, such as home and auto, bundling your insurance policies can yield substantial savings.
• Capitalize on low-mileage discounts: Some carriers provide discounts to drivers and carpoolers who travel less than expected miles annually.
• Equip your vehicle with anti-theft devices.
• Maintain a good credit history.
• Earn a loyalty discount by being a longtime customer.
• Keep a clean driving record (no accidents or moving violations in the past three years).

Do insurers offer electric vehicle insurance discounts?

Many car insurers offer discounts for driving alternative-fuel vehicles like electric cars. It probably isn't because EVs are necessarily safer than gas-powered cars (though if you crash into something, there should be no fiery explosion). Insurers know that it's good business to be a good steward of the planet. Anyway, Geico, Progressive, and State Farm are among the many insurers that offer EV insurance discounts.

Will insurance cover EV roadside assistance?

Generally, insurers do cover EV roadside assistance — meaning that if you have an insurer that offers roadside assistance (and odds are, you do), you will get somebody to come out and help if you find yourself stranded. That said, most roadside assistance vehicles can't provide a jump-start or battery replacement for an electric vehicle. But yours would at least tow you to a charging station, and of course, if you have a flat tire or are locked out of your car, your roadside assistance will be able to help you. In the coming years, however, as more EVs are on the road, roadside assistance programs — you would think — would start offering the ability to charge a vehicle at their location, just as they currently can put some fuel in a car's empty tank.

Methodology

Insurance.com commissioned Quadrant Information Services in 2022 to field rates for a 40-year-old male driver of 2022 new vehicles with good credit, full coverage (100/300/50) and a $500 deductible.